Strategic planning is critical to the success of any business. Unlike classical entrepreneurial planning, strategic diversity includes vision, mission, and thinking outside the box. This process allows determining the current position of the organization, its success, strengths, and weaknesses, as well as optimal development ways. At the same time, the basis of business management is only just the development of a tactical path but also its adaptation to the specifics of the company’s activities. A strategy is aimed at strengthening the market position of the organization and ensuring the coordination of activities with the ability to successfully compete in the market, attract customers, and achieve the goals set. For my municipality, Saint Johns County, strategic planning is a crucial concept that affects not only revenues (taxes), but also market position because the abilities to meet the expectations of the citizens and create economic demand are valuable factors in our segment. For example, St Johns County School district has been #1 in the State of Florida in Public Education since 2010 (www.stjohns.k12.fl.us). In addition, St Johns County has been the Healthiest population in the State since 2011. My municipality set about to achieve a long-term strategic plan in 2012, which I helped form, that included education, economic development, health, public safety, and infrastructure as its priorities. In developing that, we were concerned with both what needed to be changed for successful change and how the organization could function in a specific context with an appropriate base to demonstrate sustainable growth and achieve recognition.
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This plan was aimed at identifying the specific features of strategic planning and its main elements within the framework of both the public sector and the construction industry as we knew that growth was inevitable. This process was associated with a number of positive changes and a convenient mechanism to shape a scheme for disciplined change within the team and ensure sustainable performance from all perspectives, including legislative, executive, judicial, and others. A viable and inclusive strategic plan is at the root of our land development code, and when planning for growth, this type of plan is highly valued and designed to benefit not only our organization but also our citizens.
History of Strategic Management and Theoretical Concepts
Strategic management, as a broad concept that appeared in the 20th century, took a long time to acquire its modern form. This practice of controlling and managing resources can be assessed on the example of the American market. The rapid development of the US economy after World War II, when the demand for products was great and economic development was natural, was replaced by the post-industrial era, and this period continues to this day (Stiglitz, 2016). According to Kapp (2016), the characteristic features of the post-industrial era were the acceleration of the growth rates of scientific and technological progress and the new level of well-being achieved by society. An increase in the share of services in GDP, a high degree of differentiation of products, increased attention to negative forms of progress, such as environmental pollution, inflation, monopoly, consumer manipulation, an increase in the factor of individual satisfaction from the work performed, and a high pace of economic processes generated a change in the structure of the economy and its ideology. In parallel with these trends, the management thought also developed. The economic situation became more complicated, and in this regard, new approaches to managing organizations were required.
Depending on the priority of the approaches used and the reaction to external changes in the development of the management thought, Kushner (2021) considers the following stages:
- Budgetary and financial control.
- Extrapolation-based management.
- Anticipating changes.
- Management based on flexible emergency solutions.
The first three phases lasted most of the 20th century; however, beginning in the 1980s, flexible emergency management took precedence over other practices. This principle assumed that many important tasks arose rapidly, and this was impossible to foresee all of them immediately (Kushner, 2021). As a result, companies had to work in such an environment and introduce new principles of management. One can highlight the following distinctive features of this control system:
- The focus is on the implementation of strategic decisions and the integration of management actions.
- The decentralization and democratization of governance.
- The growing importance of intuition and the strengthening of the qualitative approach in assessments.
- The consideration of an enterprise as a subject of active influence on the environment.
- The use of strategies as the main tools for managing enterprise development.
The third stage of management development is also called strategic planning, and the fourth – strategic management in real time. The difference between the concepts of strategic planning and long-term planning lies in the different interpretations of the future. Based on long-term planning, the future is determined based on the extrapolation of past trends (Stiglitz, 2016). Strategic planning does not consider the future to be explored by extrapolation and implies taking the necessary steps to change the operating environment.
In addition, in strategic planning, in comparison with the long-term variant, the space of the company’s activities becomes more voluminous. As Stiglitz (2016) notes, it includes both the main elements of the internal environment of an economic organization and external aspects – social and political factors, tastes and needs of buyers, actions of competitors, and some other criteria. Moreover, the long-term goals of the firm in strategic planning cease to be a simple reflection of the conditions of current activities. They turn out to be the result of the analysis of changes in the external and internal environment of the firm. The difference between strategic and long-term planning also implies the criterion of variability, which means the development of alternative versions of the company’s future development.
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The following factors have become the prerequisites that determine the relevance of the development of strategic management:
- Integration processes that have led to the formation of financial and industrial groups.
- Business globalization. Global firms see the world as a whole in which national differences and preferences are erased, and consumption is standardized. The onslaught of global firms can only be resisted by analogous methods by developing a strategy in a competitive environment.
- The role of the top echelon of management has increased, while the set of management skills developed before World War II has become less consistent with the conditions for solving emerging problems.
- The instability of the external environment has grown, which, in turn, has increased the likelihood of sudden changes and their unpredictability.
All these factors have led to the fact that control over business processes and resource bases has acquired the form that many modern companies adhere to and promote through their development plans. Nevertheless, many concepts and approaches to strategic management were formulated long before the globalization of the market and other phenomena characteristic of today’s entrepreneurship. One of these concepts is Henri Fayol’s theory that includes the principles of effective strategic management developed as the mechanisms of effective control and resource allocation.
Henry Fayol’s Principles of Strategic Management
Henry Fayol was a management theorist and practitioner, the founder of the administrative school of management. According to Edwards (2018), in his concept, the theorist formulated 14 principles of management, which have retained their value to this day and are often referred to when discussing the issues of strategic management. The main focus of Fayol’s principles was on leaders and those who sought to show their leadership inclinations. These 14 rules are critical factors to take into account when applying to a strategic type of business control.
The main goal of labor division is to concentrate an employee on fewer goals and objectives. By directing attention and all one’s strengths, a specialist works more efficiently and can control one’s time and energy, thereby achieving productivity without experiencing a serious burden. This targeted form of work meets the principle of strategic management and contributes to resolving potential conflicts based on the workload. When taking two teams, with and without labor division, all other things being equal, the former will perform a larger volume of tasks and will do it better than the latter.
Authority and Responsibility
The one who is endowed with power should be responsible for the decisions made and the orders given. A leader or manager is a person in charge and has the right to coordinate the work process, but the degree of responsibility differs among managers and performers. The higher the rank and authority of an employee, the higher the likelihood that his or her supervisory liabilities are strict.
Employees are to respect and abide by the rules of their organizations. There should also be leaders who will monitor the obedience of company members and punish them in case of the violation of accepted agreements. Failure to comply with work discipline is a frequent article of dismissal, and no form of strategic management can be associated with subordinates’ indifference in relation to their immediate responsibilities.
Unity of Command
In an organizational environment, every employee should have only one immediate supervisor who has the power to give instructions and control the work process. The division of supervisory responsibilities among a number of people is fraught with the lack of agreement in control and distinctive approaches to personnel management. This, in turn, does not allow building a holistic work strategy that meets specific organizational interests and helps achieve high operational results.
Unity of Action
All organizational groups operating under the same goal should have a single action plan and one leader to supervise the work process. Otherwise, companies may face a risk of inconsistency in actions and the inability for different leaders to coordinate colleagues’ activities adequately. An effective strategy cannot involve multiple principles of work due to limited resources and a prearranged plan, which explains the value of teamwork.
Subordination of Personal Interests
The personal interests of an employee or a group of employees should not be placed above the interests of their companies. Any organizational issue is solved effectively only if the staff is ready to make every effort to realize their professional potential to the full extent. A productive workflow is built on dedication and self-commitment as the integral components of a sustainable and dynamic work regime.
Employees should receive a worthy and well-deserved reward that will motivate them to continue their work and follow the terms of a strategic plan. Regular rewards also build subordinates’ loyalty to their organizations and the desire to do even better. The lack of remuneration, in turn, is a negative incentive to perform immediate tasks irresponsibly since motivation is lost, and there is no effective mechanism for assessing employees’ work and achievements.
A governing center is as necessary as labor division, and this system of vertical power should be observed to build a sustainable operations flow. The degree of centralization and its proportion with decentralization depends on specific conditions and are determined for each organization individually. If companies do not have one supervising board, the reporting regime is violated, and performance gaps are observed due to disparate employees’ actions.
In any company, there should be a hierarchy from the lowest level manager to the general manager. This is necessary for the normal functioning of the whole organization structure. At the same time, the hierarchical ladder should be as small as possible to avoid the confusion of management approaches and practices. The absence of a vertical of power is fraught with the ineffective performance of operational tasks caused by weak oversight.
This principle of effective management is important as a factor demonstrating the level of the organization of the work process. Each employee should have one’s own workplace and immediate tasks. Being able to operate sustainably with enough resources and without critical issues is a valuable prerequisite for high productivity. Failure to provide subordinates with such conditions reflects the incompetence of management and limited funds for employees’ normal operation.
This principle implies combining the aspects of equality and benevolence. Managers to treat their subordinates fairly and with respect. Any manifestation of cultural, racial, gender, or any other form of bias is indicative of the violation of employees’ labor rights and hinders the effective performance of direct duties. Moreover, productivity falls if managers support discrimination and violate labor code principles. Injustice is a negative incentive that complicates communication and does not allow building effective operational strategies.
Stability of the Workforce
High staff turnover is a consequence of poor management and ineffective human resource policies. This aspect weakens companies’ performance and lowers organizations’ positions in the market. According to Edwards (2018), Fayol believes that a mediocre leader who holds on to his or her job is better than a talented but unreliable and quick-going manager. Therefore, effective control over such an indicator as staff turnover is an essential criterion for productivity.
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All employees, without exception, should have an opportunity to take the initiative, express their ideas, and suggest ways to improve their company’s performance. This approach to strategic management gives organizations strength and energy and emphasizes the role of each employee in the work process, which contributes to their dedication and self-commitment. Ignoring subordinates’ participation in decision-making, conversely, weakens interaction and affects employees’ initiative negatively, thereby reducing productivity.
A favorable atmosphere in the team is largely achieved due to a high corporate spirit supported by managers. Team leaders promote support and understanding as meaningful values to maintain at the workplace. Bringing subordinates together allows ensuring a productive work process and building a team in which union and synergy are sustainable characteristics. Failure to address such a management principle is fraught with conflicts and misunderstandings and, therefore, impaired performance.
These principles of effective management have not lost their relevance and are the basis for productive control and leadership in organizations. At the same time, in addition to Fayol’s ideas, some other concepts can be viewed as a theoretical background that has shaped modern approaches. One of these theories is the scientific management model proposed by Frederick Taylor, which has become a common form of work organization.
Frederick Taylor Concept of Scientific Management
Taylor’s theory, developed in the late 19th century, was an important step towards the development of the same principles of resource and workforce management, which are applied in many modern companies. As Schachter (2018) notes, to solve the identified organizational problems, Frederick Taylor proposed new principles for organizing production. Given the provisions of the theory, under the old enterprise management system, success depended on the ability to get initiative from employees, which, in turn, was difficult to achieve. With the scientific organization of management, the initiative is implemented in the order of absolute uniformity and on a larger scale, which does not correspond to the principles of the old system. Moreover, in addition to this improvement related to employees, the management of the enterprise should also take on new responsibilities. Thus, for instance, the administration should take upon itself the responsibility of collecting the entire body of traditional knowledge and skills that its workers possess, as well as the tasks of classifying, tabulating, and converting all this knowledge into rules, laws, and formulas that provide workers with sufficient help in fulfilling their daily duties (Schachter, 2018). As a result, the concept of scientific management is based on the careful assessment of various operational indicators that determine labor efficiency and influence subordinates’ motivation.
All these new responsibilities of the directorate fall into the following four groups that Schachter (2018) describes as the updated principles of leadership in the transition to an advanced form of scientific management:
- The administration takes upon itself the development of a scientific management background, replacing the old traditional and crude-practical methods for each individual action in different types of labor used in the enterprise.
- The administration makes a careful selection of workers on the basis of scientifically established characteristics and then trains, educates, and develops each individual employee, while earlier, a worker chose one’s own specialty and trained on one’s own.
- The administration cooperates with employees to achieve the conformity of all individual branches of production with the scientific principles that it previously developed.
- An almost equal distribution of labor and responsibility is established between the administration of the enterprise and subordinates. The management engages in those branches of labor it is better adapted to, whereas earlier, almost all working activities were entirely assigned to employees.
This combination of employees’ initiative, supplemented with new types of functions carried out by the administration of the enterprise, makes the scientific management system superior in productivity to obsolete systems. According to Schachter (2018), three of the listed elements of new management functions are found in those control approaches that are based on the principles of initiative and reward. However, under this system, they are of negligible importance, while under a scientific organization, they constitute the essence of the entire system. The fourth of these elements, which implies the equal distribution of responsibility between the enterprise management and subordinates, requires further clarification.
The basic philosophy of the system of initiative and reward provides for the need for each employee to bear almost full responsibility both for the overall plan and for each individual part of one’s work, as well as for the tools one uses. In addition to this, physical work lies entirely on an employee. To address such inequality, the provisions of the scientific organization of labor presuppose the development of numerous rules, laws, and formulas that replace the personal judgment of an individual worker and can be usefully applied only after systematic accounting, measurement, and other procedures determined by the labor code. Schachter (2018) mentions the equality of participation, which implies the legitimacy of using human labor and the inadmissibility of any form of bias. As a result, Taylor’s concept of scientific management implied restructuring obsolete manager-subordinate interactions by making these relationships equal in terms of the labor law.
Thus, all that elaboration of plans, which, under the old system, lied entirely with a worker and was based on his or her personal experience, should, under the rule of the new system, be completely carried out by the management of the enterprise in accordance with the laws of science. This is due to the fact that even if an employee were perfectly capable of developing and applying scientific data, it would be physically impossible for him or her to perform a wide range of different tasks. Therefore, the division of labor resources and creating as equal opportunities as possible corresponds to the modern principles of management promoted in different organizations, including the public sector.
The proposed concepts and theoretical aspects reflect the value of strategic management and adequate approaches to the allocation of available resources, including the workforce. However, in addition to the principles of control, additional organizational factors need to be taken into account to maintain a sustainable strategic planning system. Different working conditions require distinctive tools and steps to be taken to ensure the smooth implementation of change programs in companies. One of the crucial criteria to review is the organizational structure, which correlates directly with the quality and sustainability of strategic planning.
Organizational Structure and Its Importance to Strategic Planning
The organizational structure that provides the function of strategic management in a company is formed by the strategic planning department at the highest management level and a set of strategic business units, which include their own strategic planning services. Organizational structures that contribute to implementing the principles of strategic planning and management have evolved evolutionarily as the concept of strategic management developed. To strengthen the function of strategic management, groups of innovations, program-target approach, and matrix structures are utilized. Nevertheless, as Neis et al. (2017) state, the greatest attention should be paid to the use of the concept of strategic business units in the design of organizational structures for managing enterprises. It fully implements the principles of centralizing strategy development and decentralizing the process of its implementation, ensuring flexibility and adaptability of management, and involving a wide range of managers at all levels in the control process. This complex system allows allocating tasks and resources adequately to assign responsibilities and maintain an effective mechanism of strategic planning. Otherwise, the risks of the inconsistency of tasks with current capabilities are manifested due to the lack of a stable control system over changes and innovations at enterprises.
In practices, according to Neis et al. (2017), this is possible to create three types of strategic planning services.
- A strong central planning service that develops strategies for the entire organization and its divisions.
- A centralized planning service that performs strategic planning by providing methodological assistance and coordinating the activities of strategic business units and other divisions of the organization.
- A decentralized strategic planning service in which the authority and responsibility for the development of strategies is fully vested in the heads of strategic business units.
The choice of this or that structure of strategic planning is determined by many factors – the complexity of the organizational structure of the enterprise, its specific properties, accumulated experience, planning traditions, and some other factors. A strategy and organizational structure are closely interrelated: firstly, a strategy is the main factor that determines an organizational structure, and secondly, an organizational structure needs to create the necessary conditions for the successful implementation of a strategy. Therefore, Fauzi et al. (2021) argue that when moving to the implementation of a new strategy, this is essential to check how the existing organizational structure corresponds to it and, if necessary, carry out appropriate organizational changes. The authors note that the choice of an organizational structure is influenced by various factors (Fauzi et al., 2021). The most significant of them are the size and nature of the organization’s activities, its geographical location, the goals set, the technology used, the intensity and scale of innovations, the personnel’s qualifications, the values that leaders and employees adhere to, the dynamism of the external environment, as well as the strategy implemented. Thus, the aspects of organizational structure and planning overlap and provide a framework for conducting business activities aimed and maintaining change regimes and ensuring adequate resource allocation.
What are the Elements of a Viable Strategic Plan?
The strategic plan of any company is considered a set of missions, goals, and strategies for achieving them, formulated at various organizational levels by the responsible parties. The team involved in developing and implementing a viable plan includes not only managers but also ordinary employees engaged in creating a sustainable algorithm. Moreover, according to Bryson and Edwards (2017), “strategic planning can be applied to organizations, collaborations, functions (e.g., transportation or health), and to places ranging from local to national to transnational” (p. 1). This means that this business concept is multifunctional and has a number of implications and options to implement.
In its traditional form, a viable strategic plan includes several basic elements. Bryson and Edwards (2017) discuss the fundamental activities that shape the construction of this concept and form its framework. The authors focus on public sector organizations and note that this is not necessary to follow a strict order of all the activities presented, but the more elements are used, the higher is the likelihood of successful planning (Bryson & Edwards, 2017). As a result, a viable strategic plan consists of several elements that are to be observed by analytical teams.
At this stage, the main elements to include in the proposed plan are discussed, and an approximate timeline and resource framework are discussed. The list of stakeholders is determined, and the interests of all participants are considered to identify the need for involvement in a specific project. This element of the plan is mandatory and standard for most strategies since any analysis requires estimating resources and time periods.
Further, the main objectives are identified, which correspond to the organization’s business specifics. Bryson and Edwards (2017) highlight “mission, vision, values, and goals,” as well as “applicable legal statutes or mandates” (p. 7). This element of a strategic plan is important in the public sector since the aforementioned lenses become the key determinants by which the target audience is guided and recognizes a particular company.
Analysis of Operating Environments
The following element, which is a SWOT analysis, is a valuable stage of a strategic plan. This framework is a helpful approach that may contribute to identifying the main weaknesses and strengths by evaluating the organization’s internal capabilities and threats and development opportunities by determining the peculiarities of the external environment. Due to this analysis, stakeholders can highlight the features of a specific business, including its strengths and pitfalls.
While taking into account potential changes in the mode of operation, this element of a strategic plan is aimed at identifying additional challenges. In a dynamic work environment, different circumstances can affect the stability and rhythm of processes in organizations. Therefore, given various conventions and potential shifts in the direction of development, such an analysis complements the aforementioned SWOT framework and helps avoid undesirable outcomes.
This element of a viable strategic plan involves the direct formulation of strategies. When taking into account the identified challenges and potential obstacles, the range of problems is determined, and the preliminary development of a particular project is drawn up based on this information. In the future, certain aspects may change, but in general, at this stage, the basic strategic framework is compiled to work further.
After identifying the key strategies to apply, their feasibility needs to be verified. For this purpose, relevant criteria need to be taken into account, for instance, the specifics of the business, the available resource and financial bases, stakeholders’ preparedness, and other aspects. This element of the plan is important because it can help identify potential gaps or deficiencies. In addition, the final versions of the strategies to implement are obtained.
This stage is the process of implementing the defined elements of the plan. All resources are combined, and work is carried out in accordance with the tasks and the time required to complete all procedures. In case a strategic plan is based on a change process, each of the steps should be taken based on a clear sequence verified initially to avoid discrepancies and mistakes.
This element is mandatory for a viable plan since it implies constant control over all stages of activities. Corresponding subtotals are summed up, and in case of undesirable changes, edits and modifications are made timely. Monitoring should be continuous to ensure the sustained implementation of all intended objectives and results; otherwise, there is a risk of inconsistency between the original goals and the final results.
Finally, the trailing element of the whole process is optional and can be omitted if no significant deficiencies appear during the activities performed. Nevertheless, a viable plan involves an additional assessment of the prepared plan to compare the results obtained with those predicted initially. This work can help correct certain gaps and prevent them in the future to make the mode of strategic planning smoother and less time-consuming.
The presented elements of a viable strategic plan reflect a clearly compiled algorithm of work, which covers different areas and includes not only practical tasks but also forecasting steps. By following such a program, this is easier to create a sustainable transition to the desired change or to strengthen certain aspects of the business. Moreover, the more carefully each of these elements is performed, the less are the risks of obtaining distinctive results from those planned in advance. Therefore, in its ideal form, a viable strategic plan should include the aforementioned stages.
The Need to Develop a Strategic Plan in the Public Sector
Strategic planning is a set of measures that can be adapted to the needs and interests of different stakeholders. Individual entrepreneurs can also benefit from this framework by creating a stable and credible environment for building their businesses. However, as Bryson (1988) states, “strategic planning was designed originally for use by organizations” (p. 74). This means that the operating conditions of companies allow implementing the aforementioned stages since any organizational structure has an individual resource base, a team of employees, and other elements to use. In the public sector, where budgetary and non-profit organizations operate, adherence to the concept of strategic planning is of particular importance due to the ability to follow clear development steps while not violating the official requirements for their work. This perspective distinguishes such companies from private ones, where the owners have greater freedom to choose the volume of investment, innovation to apply, and other development solutions. Therefore, the public sector assumes strict adherence to such a planning algorithm as a stably effective optimization mechanism.
As a good reason to stick to strategic planning in the public sector, one should pay attention to a number of conventions that organizations in this field have to follow. Legislative provisions, tax reporting, responsibility to the population, and other factors explain the need to create a clear framework that contributes to avoiding risks and prevents violations of relevant regulations. For instance, in the field of education, stakeholders do not have an opportunity to adapt curricula to individual interests or receive additional financial dividends. In the healthcare sector, employees are not allowed to create programs that are aimed at capitalizing profits without the knowledge of supervisors. At the same time, according to Bryson (1988), strategic planning allows setting clear goals to achieve and build development scenarios that meet organizations’ interests. Companies in the public sector are tied to their respective mandates and legislative principles, and if an effective plan is developed, strengthening individual aspects is possible but not a complete transformation of the line of business. As a result, for such organizations, effective planning is one of the few techniques to improve the quality of work.
Supervisors in the public sector use control methods that are different from those utilized in the private sector. Bryson (1988) notes that, in addition to financial reporting, actual performance totals are critical metrics that reflect companies’ success. Each of the planning steps implies achieving a specific objective. Moreover, public organizations are often involved in political and economic areas of state development, which explains the value of ensuring sustainable development. The budgetary funds allocated for the implementation of the tasks set are not always sufficient, and the need to use the maximum of the available resources is a mandatory and inevitable condition. Strategic planning, in turn, allows avoiding rash costs or ineffective decisions due to the structuredness of the entire process. Bryson (1988) remarks that situations can be different, and emergency interventions occur not only in the private but also in the public sector when, due to external circumstances or internal turmoil, urgent changes are needed. However, unlike private businesses, any intervention in public organizations is associated with high accountability and the pursuit of not vested interests but high-performance outcomes. Therefore, for the public sector, strategic planning is a meaningful concept.
Strategic Planning in the Construction Industry
In the construction industry, strategic planning is as important as in many other spheres in both the public and private sectors. The need to create reliable projects, modernize infrastructure, meet the interests of the population, and other tasks explain the relevance of this concept. To ensure the implementation of a construction organization’s mission, strategic planning, as a set of target decisions and actions, should be defined and approved by the management. According to Farahmand (2017), within the framework of such planning, solutions need to be worked out in the areas of resource allocation, adaptation to external factors, controlled coordination of financial and production aspects of activities, as well as organizational strategic foresight. Therefore, a comprehensive assessment of the working environment is an imperative condition.
The resources of a construction organization are often limited, and plan developers’ task is to allocate them as rationally as possible to achieve the final results with the minimization of the resources consumed. Kabeyi (2019) highlights that adaptation to external factors involves organizing interactions with the external environment, including with other business entities, government, and local authorities. The purpose of internal coordination is to ensure the effective operation of the divisions of the construction company based on the preliminary identification of its strengths and weaknesses. Organizational strategic foresight, in turn, is based on the experience of past strategies and is associated with the study, synthesis, and analysis. Therefore, to develop a high-quality plan that can meet all stakeholders’ interests, a construction organization needs to receive and process a large volume of information and engage competent specialists. This activity does not guarantee success, but with its help, a construction company can create a stable algorithm that allows assessing resources adequately and allocating sufficient funds to optimize the work process. This practice is generally accepted, and if implemented correctly, a well-compiled plan is an essential instrument to make a construction business sustainable.
The missions of large construction organizations and small ones have significant differences. Small companies determine both the activity and the goals arising from it based on their own capabilities in the creation and implementation of a construction product. As El-Hallaq and Tayeh (2016) argue, most often, they are guided by participation in this process as subcontractors. Nevertheless, as practice shows, small construction organizations may also act as general contractors by focusing on the demands of the construction product market, which increases their business opportunities.
The goals of the construction organization determine its activities with the implementation of the identified values. When formulating goals, this is crucial to take into account that they should not only be specific and achievable but also ranked based on the time of their implementation. According to Kabeyi (2019), when developing a strategic plan at the stage of researching a construction organization’s strengths and weaknesses, developers should consider individual areas. They are marketing, for instance, pre-sale and after-sale service for customers or the assessment of profit levels, finance, construction production, labor resources, as well as the culture of the organization. These aspects create a holistic mechanism for working towards planning and contribute to establishing sustainable activities. Moreover, they are critical factors that help cover specific tasks comprehensively and develop a specific activity algorithm timely.
In terms of obtaining orders for construction, marketing research work plays a significant role. El-Hallaq and Tayeh (2016) note that builders need to assess their competitiveness, and this assessment is closely related to the subsequent study of strategic alternatives – a limited increase in the volume of construction work, a certain and relatively high growth, a reduction in the volume of activities, and, finally, a combination of all alternatives. The result of this research is the choice of a specific strategy option. At the same time, this is necessary to take into account such aspects as risks, time factors, and owners’ behavior and their subsequent influence on the adoption of individual planning decisions. The final version of a strategy should be presented by the calculation of planned indicators for all areas of the construction organization (El-Hallaq & Tayeh, 2016). These principles of strategic planning in the segment under consideration are not unique, but their application in the construction business is important due to the strict conditions of contracts and orders from different interested parties.
Strategic Planning in Construction from an Administrative Perspective
In addition to business, marketing, and other aspects that influence the nature of strategic planning in the construction industry, the administrative factor needs to be taken into account. The authorities responsible, among other things, for the allocation of budget funds for construction in the public sector do not deal with these tasks in isolation and, as a rule, have many departments and subordinate units involved in planning activities. This vertical of control is an adequate algorithm to ensure that all the needs of the population are met and, at the same time, not to miss essential nuances related to financing, adherence to technical requirements, and other factors. For instance, in St Johns County, FL, there is an inspection body overseeing the construction of private and public swimming pools (“Welcome to the public swimming pools,” 2020). The specialists of this department issue permits for installation work, check the compliance of the declared parameters with technical regulations, supervise the safe use of these structures, and perform maintenance if necessary. This practice proves that division into departments for convenient administrative work is a natural and necessary solution for strategic planning in public construction.
Each aspect of construction is monitored by designated authorities and departments to organize a sustainable planning system on which the success and productivity of construction activities in this area depend. With reference to aforementioned St Johns County, the local government uses sales tax proceeds as a resource to construct public buildings, most recently the Freedom Crossing Academy and Picolata Crossing Elementary School (“District facts,” 2021). In addition to full funding, construction in the county is also partly funded, with Palm Valley Academy being such a facility built in part with sales tax proceeds (“District facts,” 2021). The ability to establish a sustainable financing mechanism for public construction emphasizes the effectiveness of local governance and reflects the authorities’ interest in ensuring the stability of this industry that directly depends on allocated funds. Strategic planning, as an integral criterion of sustainable activities, is performed through the initiatives of relevant units responsible for monitoring the current situation in the sector and making proposals for infrastructure optimization. Therefore, the administrative aspect includes the establishment of a sustainable chain of management interaction, which, in turn, is implemented through organizing accountable departments’ and units’ interactions.
The organizational context of strategic planning is shaped by regulatory initiatives at the administrative level, which creates a background for related initiatives. Deslatte and Swann (2017) provide a detailed framework of how these initiatives are implemented in a real-world setting of roles and responsibilities. The authors cite three critical aspects to take into account – “capacities, executive turnover, and regulatory and environmental complexity” and note that the first of them is a criterion that directly depends on the management decisions of the authorities (Deslatte & Swann, 2017, p. 809). Leadership turnover and service delivery are the factors related to stability and complexity, respectively (Deslatte & Swann, 2017). Consequently, the resource base allocated for construction in the public sector is a parameter for which the local administration is responsible. The more the authorities are interested in the optimization of infrastructure and the construction of new facilities, the more stable the full capacity of the base should be. Otherwise, even in case of compliance with regulations and effective leadership solutions aimed at overseeing construction work, the implementation of plans will be impossible due to the lack of funds and disagreements among supervising authorities.
As a rule, the authorities formulate specific goals and determine the sources of funds for their achievement in relation to a particular location, which means planning the development of the territory. If this group of people is outside the territory, one can talk about external planning. Thus, the central authorities may decide that a certain part of a city or village needs to be developed faster, and some types of settlements should be gradually eliminated by relocating people to more modern buildings. Special units under the control of the main departments are involved in zoning and carry out targeted work to find territories for optimization, identify reasons for renovation, and other activities. However, a fundamentally different type of planning is participatory, or communication planning, which involves the participation of key stakeholders and groups.
Communication Planning in the Construction Industry
In communication planning, the subject of planning can be either an individual person or a group of people in certain relationships. According to Akunyumu (2016), business planning is carried out in the interests of business owners, and the subject making the final decision on the choice of a particular plan is the owner. However, experts in the planned area and specialists with the necessary professional experience can be involved in the preparation of variants of the plan. Planning, as a rule, is aimed at finding the best use of resources, including financial, human, material, organizational, and other factors, to obtain the best possible result.
A comprehensive plan for the socio-economic development of the territory, covering all spheres and industries, is possible only as a plan-consensus in market conditions. When drawing up such a plan, the interests and intentions of both governing bodies of different levels, for instance, municipal services, and business and society are coordinated. In this context, as Akunyumu (2016) argues, this is important to distinguish between the subject of planning, or who develops a plan, and the subject of implementation, or who implements a plan. The best results are achieved when these subjects are combined, and a plan is implemented by the party who has developed it. Therefore, in modern technology, much attention is paid to the process but not just the result of planning. A properly organized strategic planning algorithm allows the majority of stakeholders and wider society to be involved in the development of a plan.
Zonal planning, which is part of the communication programs, sets the projection of a socio-economic plan on a particular territory by showing exactly where and how the infrastructure will develop, as well as how it will be distributed over the territory of residence, work, recreation, and other objects. Plans, which are often called action plans, contain a list of specific actions with deadlines and allocated resources. In modern plans, goals, resources, and actions are the subjects of planning. The planned solution, respectively, contains at least two groups of characteristics –the desired state of a control object at reference time points (result indicators) and the ways to achieve these states (the indicators of the resources used, actions, and regulators) (Akunyumu, 2016). At the same time, the emphasis in different documents is on distinctive components. All these aspects are taken into account by the responsible authorities who determine where and why corresponding infrastructural changes are needed.
Work experience in a public municipality is a valuable factor that allows talking about the importance of strategic planning in this industry and the significance of such a concept from the perspective of the rational use of all available resources. For instance, an appropriate job in a government city is a guarantee that an employee adheres to the idea of the judicious use of innovation and growth mechanisms to ensure sustainable development of infrastructure. Otherwise, the city loses mobility, and not only public but also private buildings become tasteless and rather spoil the city’s appearance than complement it.
The implementation of strategic planning in such an administrative center is an extremely demanding task. In addition to mobility as a critical aspect of an advanced and resilient infrastructure with uncongested traffic and free road and cycle routes, some other factors need to be considered. Zoning, as one of the design components, is a significant aspect that determines how competently and naturally urban objects are distributed. Suffice it to recall the work of the great Brazilian architect and designer Jaime Lerner, who, as Adler (2016) states, turned his hometown Curitiba into one of the most picturesque and rationally planned cities in the country, making it a landmark and inscribing his name in history. Adhering to all required building codes while creating a beautiful and functional space is a challenge that requires effective planning. Therefore, in this activity, careful assessment and analysis are integral attributes of successful design, which, in turn, directly influence the appearance of the city.
Since architecture is an art, design is a creative process. Meeting the interests of citizens is an important nuance, which is one of the determining factors in such work, and infrastructure planning is a stage in creating an urban image. For instance, the failure to address rising sea levels is a testament to the incompetence of planners and architects who are not making enough efforts to help the population keep their homes intact in case of natural disasters. As Adler (2016) remarks, aforementioned Jaime Lerner worked primarily to ensure that his fellow citizens were comfortable living in Curitiba. His activities have borne fruit and proved that competent planning based on the analysis of the city’s current needs and the capabilities of the technical base could be the key to the flourishing of urban infrastructure. Moreover, Robertson (2010) cites the Brazilian architect who argued that simplicity might not be feared if it could bring rich rewards. In other words, effective planning is not always a colossal financial investment but rather a reasonable search for optimal solutions by utilizing the existing conditions as a background of creative projects.
An important factor of successful planning is the variety of approaches and concepts used in the development of the construction industry and specific territories. Equity and inclusion criteria should be considered conditions to be met regardless of the available budget, regulatory approvals, and other factors. According to El-Hallaq and Tayeh (2016), the personal experience of an architect or designer is a variable that influences the quality of planning. The more trained an employee is, the higher is the likelihood that specific plans will resonate among citizens and will be approved not only by professionals and authorities but also by ordinary people. The aesthetic of planning relates to combining the available resources based on anticipated outcomes rather than current conditions. The ability to equip a functional space largely depends on whether different parties’ wishes are met and whether the rights of some of them are not infringed. Through strategic planning, constructors can answer these questions and create an enabling environment for infrastructure development.
For municipalities, strategic planning plays the role of a clear algorithm that should be adhered to in order to avoid crucial mistakes, which, in turn, are fraught with severe consequences and threats to people’s lives. Improperly designed public infrastructure can be dangerous, and each of the steps of a specific plan carries significance as a component aimed at improving operational safety. The public sector, like many other spheres, is subject to changes caused by political, social, economic, and other drivers. Therefore, to avoid gaps in work and meet the interests of the population, implementing the concept of strategic planning indicates a responsibility for the activities staff perform and for their outcomes.
Strategic planning, as a valuable practical methodology, is a set of steps that are elements of compiling development projects, and each of these steps is of particular importance for different organizations. In the public sector, this concept finds its application more often in the private sector due to a number of conventions that such companies are forced to adhere to, for instance, legal regulations or tax obligations. Nevertheless, strategic planning, which includes a number of stages, is applicable to different organizations, and in the public municipality sector, its use is justified by a number of objective reasons. The tasks to follow safety parameters, comply with regulations, ensure sustainable development of infrastructure, and meet the interests of the population are among the goals of utilizing this methodology in the industry in question. Personal experience in the sector highlights the real benefits of adhering to strategic planning, and the example of Jaime Lerner, the eminent Brazilian architect, proves that success requires analyzing and assessing the environment, which, in turn, is realized through effective strategic planning.
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